Passing Down the Experience: Exploring the Effects of Online Customer Reviews on Service Diagnosticity

Consumers are growing increasingly dependent on Online Customer Reviews (OCRs) when making consumption decisions, more so for services due to their intangibility and variability. To this end, we advance a research model that explores how numerical ratings and opinionated reviews, as key constituents of OCRs, affects consumers’ evaluation of service diagnosticity, which in turn enhances the latter’s decision making process. Furthermore, we postulate that consumers’ preference structure will determine the effectiveness of numerical ratings and opinionated reviews on service diagnosticity. Our research model was subsequently validated via a field study that was conducted on a custom developed online restaurant review site. Results suggest that numerical rating and opinionated review can amplify the effectiveness and efficiency of consumers’ decision making process by bolstering the latter’s ability to diagnose a given service. Nevertheless, the effects of numerical ratings and opinionated reviews are moderated by consumers’ preferences for content relevance and self-reference.